WPP discusses impact of Publicis-Omnicom merger

WPP, one of the leading world marketing communication agencies, will become a more horizontal business if the Publicis-Omnicom merger goes through, according to Martin Sorrell, WPP CEO.

In wide-ranging remarks at the third-quarter results presentation to analysts, Sorrell said: “The best thing about POG from our point of view is that it will push our people to horizontalise even more. The way forward is about building WPP into a more cohesive operation, whilst acknowledging that verticality is important from a tribal point of view.”

WPP owns agency brands including Grey, JWT, Ogilvy & Mather, Mindshare, MediaCom and MEC.

Sorrell, who makes frequent jibes at his rivals’ pending merger, also made light of meeting of top executives from Publicis and Omnicom. “The latest interesting one was a wonderful weekend in Miami. Everybody’s happy about it – going to Miami for a four-day conference is not exactly Siberia in winter.”

WPP reported revenue up 5 percent to $4.33 billion in the third quarter of 2013, boosted by an acceleration of growth in the US and Continental Europe.

North America, which accounts for 35 percent of WPP’s total revenue, grew 4.6 percent year-on-year to nearly $1.6 billion in revenue. WPP’s home territory, the UK, which makes up 13 percent of the total, saw revenue up 8.1 percent to $570 million.

Sorrell said: “What we lose on the faster-growth market swings, we gain on the mature market roundabouts,” He said that companies are starting to spend more in order to protect their market share in the US and Western Europe.

Asia Pacific and Latin America grew 5.8 percent to $1.3 billion in the third quarter. Sorrell said: “We remain BRIC bulls.” He added, “China has slowed, but looking at the forecasts I think China is stronger than people give it credit for. Brazil for the first nine months is still running at 11-12 percent, and India is at 6-7 percent.